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Obama Win Leads To Gold And Silver Jumping 2 And 3 Percent

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From GoldCore Gold Bullion

Obama Wins; Gold And Silver Jump 2 and 3 Percent

Today’s AM fix was USD 1,730.50, EUR 1,345.86, and GBP 1,080.75 per ounce. 
Yesterday’s AM fix was USD 1,691.75, EUR 1,321.58, and GBP 1,058.80 per ounce.

Silver is trading at $32.01/oz, €25.18/oz and £20.12/oz. Platinum is trading at $1,559.50/oz, palladium at $614.00/oz and rhodium at $1,120/oz.

Gold soared $32.10 or 1.91% in New York yesterday and closed at $1,716.20. Silver surged to a high of $32.25 and finished with a gain of 2.76%.


Gold in USD – Gold’s Performance in the First 4 Years of Obama’s Presidency

Gold fell slightly in Asia prior to eking out further gains and rising above $1,730/oz in early European trading after President Obama was confirmed as the next President of the U.S.A.

Obama’s election means that quantitative easing, ultra loose monetary policies and currency debasement are set to continue in the world’s number one economy which is bullish for gold – and indeed silver.


Precious Metals Performance in USD in the First 4 Years of Obama’s Presidency

The scale of the economic, fiscal and monetary challenges in the U.S. are so great that whether Obama or Romney was elected, gold and silver were set to continue in their bull markets.

However, some market participants believe that Romney would have been more conservative - fiscally and monetarily.

Romney may have talked a good game rhetorically but there may not have been a whole lot of difference in the fiscal and monetary approaches of both men and any differences would likely be a matter of degree.

U.S. and global economic data suggests that we are on the brink of a severe global recession and or Depression and there is a real sense of rearranging the chairs on the Titanic about the U.S. election.


Chart via SmartKnowledgeU via Gold Seek (see Commentary)

US Consumer Credit numbers for September are released at 2000 GMT and expected at $10.6 billion.

Eurozone contagion risk remains real as seen in both Spain and Greece. The general strike continues in Greece as MP’s debate and are set to vote this evening on the 13.5 billion euro austerity plan. 

November ushers in the festival season in India with Diwali and during this time many weddings are planned.  Physical buying in Asia is expected to pick up due to the consumer demand in India and as China again begins to stock up for Christmas and the Chinese New Year.


Chart via SmartKnowledgeU via Gold Seek (see Commentary)

Investors should prepare for rising prices and more expansionary monetary policy now that President Barack Obama has won re-election, investor Jim Rogers told CNBC on news of the election.

The co-founder with George Soros of the Quantum Fund said he expected Obama’s policies to drive up commodities and drive down the U.S. dollar.

As the Federal Reserve moves to ‘stimulate’ a stalled economy through debt purchases, Rogers says markets should expect the status quo to remain the same.

“If Obama wins, it’s going to be more inflation, more money printing, more debt, more spending.” Rogers told CNBC, saying he expected to sell U.S. government debt and buy precious metals, such as silver and gold. 

“It’s not going to be good for you me or anybody else.”

“It looks to me like the money printing is going to run amok now, and spending is going to run amok now,” Rogers stated. “I have to invest based on what’s happening and not what I would like.”

Rogers said that he didn’t vote for either Romney or Obama, saying that “they’re both evil as far as I’m concerned.”

With the re-election of Obama absolutely nothing has changed and we are likely to see precious metals perform as they did in Obama’s first term – gold rose 136% and silver 223% (see chart and table). Much of those gains were seen in the first 2 months, November and December 2008, after Obama was elected and prior to him taking office and we may see that again given the strong seasonal factors and very strong fundamentals today. 

With regard to the economy, Obama is strong on hope which he has yet to deliver.

As ever we believe it is best to hope for the best but be prepared for less benign scenarios.


Cross Currency Table – (Bloomberg)

NEWSWIRE
Moscow (AP) -- Divers Find Sunken Russian Ship Carrying Gold Ore
Divers have found a Russian ship carrying 700 tons of gold ore that sank off the Pacific coast last month. The freighter Amurskaya had been missing since Oct. 28 when it sent a distress call from the Sea of Okhotsk, an arm of the Pacific.

A statement from the Transportation Ministry said its 11 crew members remain unaccounted for.

The ship was found by divers in about 75 meters (230 feet) of water on Wednesday, the ITAR-Tass news agency reported. Police have lodged criminal charges against the ship's owner, who also is director of the Nikolaevsk-on-Amur port, where the ship is registered, for allegedly instructing the ship to sail despite bad weather and improper cargo procedures.

No details on how much gold the ore could contain have been released.

(Bloomberg) -- Pentagon Challenges Chinese Monopoly on Rare Earths: Commodities
The Pentagon and Toyota Motor Corp. are trying to crack China’s global monopoly on mining the most valuable rare earths used in unmanned military drones and electric-car motors.

The U.S. Department of Defense and Asia’s biggest carmaker are working with Canada’s Ucore Rare Metals Inc. and Matamec Explorations Inc., which are developing North American mines that would boost supplies of so-called heavy rare earths. Those are the less-abundant members of a group of 17 chemically similar elements critical to make a host of products from wind turbines to high-performance magnets for cars and weapons.

Foreign buyers are being driven to find alternative producers after China slashed exports in 2010, partly to conserve material for its own industries. The Asian nation today supplies about 95 percent of global demand, triple its market share of 1990, presenting a risk for foreign makers of the next generation of wind turbines and environmentally friendly lighting technology.

“People won’t make a decision on manufacturing something if they don’t know their supply is reliable,” said Jack Lifton, a senior fellow at the Institute for the Analysis of Global Security, which studies the links between energy and security. “If you had a reliable American supply of heavy rare earths, General Electric might decide to make magnets in the U.S.”

‘Incredibly Complex’
Of more than 400 proposed rare-earth mines around the world that are tracked by Technology Metals Research LLC, only five or six have enough heavy rare earths and are sufficiently advanced in their development to have a shot at making it into production, said Gareth Hatch, a co-founder of the Carpentersville, Illinois-based firm.

“The race is which deposit will be first at the finish line,” said Andre Gauthier, chief executive officer of Montreal-based Matamec.

There are risks in early-stage mining projects like those planned by Matamec and Ucore. Development requires raising hundreds of millions of dollars of funding. Mining rare earths is “incredibly complex,” said Chris Berry, founder of New York-based researcher House Mountain Partners LLC.

“The major risk is the understanding of the metallurgy and successfully separating each of the rare-earth elements,” he said.

Price Volatility
Rare-earth prices and stocks have been volatile over the past two years. The commodities have slumped since mid-2011, having surged as much 10-fold following Chinese export curbs. Molycorp Inc., which plans to produce rare earths in California, quintupled in less than a year after a July 2010 initial public offering. The Greenwood Village, Colorado-based company now trades below its IPO price. Australian producer Lynas Corp. tripled in 2010 and since then has dropped 65 percent.

That hasn’t stopped exploration companies outside of China touting their potential for producing heavy rare earths such as dysprosium and terbium, all of which are harder to find and therefore pricier than so-called light rare earths.

Toyota Tsusho, Toyota’s trading unit, has a 49 percent stake in a joint venture with Matamec and is funding the feasibility study at the Kipawa project in Quebec. Toyota will harvest dysprosium from the mine, while other deposits on the same property also could be developed, Gauthier said.

Kipawa’s initial heavy rare-earth output will be about 2,000 metric tons and may rise with further exploration on the property. Matamec is operating a pilot plant at the site. Estimated capital expenditure will be about $315 million, according to Edward Otto, an analyst at Toronto-based Cormark Securities Inc.

Alaska Mine
“We think there are places for two to four heavy rare- earth deposits in the world outside China,” Gauthier said in a telephone interview on Oct. 26. “The first can reach better agreements with end-users.”

Ucore’s Bokan Mountain deposit in Alaska may produce about 3,000 tons a year of rare earths by 2016, including enough dysprosium to meet domestic needs, CEO Jim McKenzie said.

The project will likely get the permits it needs as Alaska is a mine-friendly state and the project has the backing of Senator Lisa Murkowski and Governor Sean Parnell, said House Mountain’s Berry, who has previously consulted for Ucore. The mine will cost about $150 million to build, according to Jon Hykawy, an analyst for Toronto-based Byron Capital Markets Ltd.

Pentagon Accords
The U.S. Department of Defense may already be forming a nascent non-Chinese supply chain for high-performance magnets used in weapons systems that require heavy rare earths, said Jeff Green, president of Washington-based lobbying firm J.A. Green & Co.

Ucore said in October that the department initiated an exploratory partnership. Also last month, Canadian magnet maker Great Western Minerals Group said it was chosen by the department to study the supply of yttrium oxide, which is used in jet engines, while closely held U.S. magnet maker Thomas & Skinner Inc. said the Pentagon will invest in a study of neodymium-iron-boron magnets.

Green lobbied the Pentagon on behalf of the three companies. Hitachi Ltd.’s patents for the magnets expire in 2014, he said in an interview.

“The floodgates should open then,” Green said.

China consumes two-thirds of global rare earths supply, while the U.S. consumes about 10 percent, data from Technology Metals Research shows. Demand for dysprosium, yttrium and terbium will exceed supply, according to the firm. Heavy rare- earth production has remained almost unchanged over the past five years at around 1,700 tons a year, Lifton said.

Auto Demand
“There will never be enough heavy rare earths, and the prices are going to be strong,” Lifton said. “That’s where we’re stuck.”

The Matamec and Ucore mines may lead non-Chinese projects in expanding production of heavy rare earths by 60 percent by the end of the decade, according to Byron’s Hykawy.

The growth will be needed to satisfy expanding demand from cars and consumer electronics in emerging markets, according to Lifton. Ucore’s McKenzie says the biggest demand for heavy rare earths will come from the automotive and aerospace industries.

China hasn’t identified new rare-earth resources and could exhaust its own in five to 30 years, while non-Chinese rare- earth supply is projected to increase fivefold to 31 percent in 2016, Lifton said.

“China’s demand is going to be rapacious, and if the U.S. has these materials, China could be a net importer,” McKenzie said. “The U.S. can turn the tables now.”

For breaking news and commentary on financial markets and gold, follow us on Twitter.

NEWS

Gold Extends Advance on Speculation U.S. May Continue Stimulus - Bloomberg

Gold Jumps Most in 7 Weeks as U.S. Fiscal Cliff Awaits - Bloomberg

Gold hits 2-week high on Obama victory - Reuters

Get Ready for Cheap Money 'Run Amok': Rogers - CNBC

COMMENTARY

Gold Soars, Futures Plunge As Free Reign For Bernanke Appears Assured – Zero Hedge

Gold, the election and the importance of physical demand – Steel - Mineweb

Are Republicans or Democrats Better for Gold & Silver Performance? - GoldSeek

Good Money Is Real Money – Business Insider

Ron Paul: The Economics Of Disaster – The Hill

 

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Wed, 11/07/2012 - 09:43 | 2955559 pods
pods's picture

Gold will go higher due to our economic system, not because of which puppet does the "speaking."

pods

Wed, 11/07/2012 - 09:44 | 2955565 MillionDollarBonus_
MillionDollarBonus_'s picture

Last night my girlfriend and I saw the hot new action thriller "The Zone", and it got me thinking ... Sometimes cops need to go outside the law in order to get things done. Sure, the law protects from minor criminals, but when the enemy is ruthless law enforcement needs to be ruthless too. How can we fight terrorists in America when we cry all day on the internet about drones flying over America? How can we protect ourselves against cyber attacks when we're constantly whining about "internet freedom"? How can we reform rogue terrorist states and spread democracy when wimpy war protesters flock to the streets to protest every foreign intervention? America has become a nation of wimps. This movie reminded me of what American law enforcement is really about - doing what is necessary to keep the peace and defend values of decency and morality. It's just too bad that wimpy nerdy libertarians and whiny war protesters have no sense of patriotism or national responsibility and continue to undermine our national security and sense of national pride.

Wed, 11/07/2012 - 09:48 | 2955583 a growing concern
a growing concern's picture

Meh.  I could have used more "doomer libertarian" drivel.  Maybe next time?

Wed, 11/07/2012 - 09:49 | 2955584 Bazinga
Bazinga's picture

I will push to keep the drones only over your space, not mine.

I will push to have your house subject to an internet kill switch, not mine.

I will push to have the cops that work outside of the law in your town, not mine.

Enjoy your nanny state!

Wed, 11/07/2012 - 09:51 | 2955591 pods
pods's picture

Girlfriend? Bwwaaaaah!

You are gold MDB, gold. :)

pods

Wed, 11/07/2012 - 09:56 | 2955612 krispkritter
krispkritter's picture

He finally patched the air leaks...

Wed, 11/07/2012 - 11:33 | 2956083 Muddy1
Muddy1's picture

The headline for the article is BS.  Gold currently DOWN .22%, silver DOWN 1.47%, the dollar has recovered all of it's overnight losses and is green by .25%.

Wed, 11/07/2012 - 09:52 | 2955593 JerkOff
JerkOff's picture

Double speak much?

Wed, 11/07/2012 - 09:56 | 2955610 Sheikh Djibouti
Sheikh Djibouti's picture

Wow, such a long, somewhat long-winded comment, placed second to the top, so soon after posting ... It's almost as if it was prepared ahead of time and copy-pasted in place to make a statement about moving to a more authoritarian police state ...

Nah, must be me.

Wed, 11/07/2012 - 10:13 | 2955689 Offthebeach
Offthebeach's picture

( Ballpark rough numbers. )

Revolution -Civil War- WWI+II to Reagan, 1 trillion debt.
Now, 16.4 trillion. Going up in a month.( fiscal cliff )
Present guess, 22 trillion in 4 years.
Last month, 200 billion = 2.4 trillion for 2013.
Sequester law, taxes going up, spending cuts.
Last month, 60% of new jobs went to over 50.
Student debt serfs. ( with no/ mcjobs )
Boomer bulge, either retire and push up costs, or stay working and take/keep jobs.
More Bernanke fuel, commodities inflation ZIRP.

Enjoy.

Wed, 11/07/2012 - 10:15 | 2955697 aerojet
aerojet's picture

You ought not get confused--movies are not reality.  No matter what is depicted in a film, it is a fantasy, including films that suppose to be based on real events.  The most ruthless people in the world have always been those acting under the color of law, from within the power structure of the state itself.

Wed, 11/07/2012 - 10:24 | 2955732 TheCanadianAustrian
TheCanadianAustrian's picture

Word, MDB. Word.

Wed, 11/07/2012 - 11:59 | 2956254 Bansters-in-my-...
Bansters-in-my- feces's picture

MDB....

THE SOONER YOU STOP TAKING ON AIR THE BETTER OFF WE ALL WILL BE.

Ps....

Your girl gives good blow jobs.....Thats not yours on her chin this morning.

Wed, 11/07/2012 - 09:52 | 2955597 SheepDog-One
SheepDog-One's picture

'Economic system' being 'Lie, extend, print and pretend'. We'll see how long that actually lasts now...I get the funny feeling a real shitstorm is what we'll get.

Wed, 11/07/2012 - 10:06 | 2955663 Eireann go Brach
Eireann go Brach's picture

Jim, you bow tie wearing old bastard! Shut your fucking piehole and go lie on some beach in Thailand, and bang as many of those young hookers as you can, because soon your old balls will give up on you!

Wed, 11/07/2012 - 09:46 | 2955574 d edwards
d edwards's picture

Rogers left "continued personal misery" off his list.

Wed, 11/07/2012 - 09:50 | 2955587 HelluvaEngineer
HelluvaEngineer's picture

...and I got a free phone!

Wed, 11/07/2012 - 09:51 | 2955590 LawsofPhysics
LawsofPhysics's picture

He who has the gold makes the rules.  Same as it ever fucking was.

Wed, 11/07/2012 - 09:53 | 2955599 ACP
ACP's picture

Eh-eh.

He who holds the gold, and can keep it.

Wed, 11/07/2012 - 10:07 | 2955667 LawsofPhysics
LawsofPhysics's picture

correct, same as it ever was.

Wed, 11/07/2012 - 11:00 | 2955890 ParkAveFlasher
ParkAveFlasher's picture

Stop making sense!

Wed, 11/07/2012 - 09:52 | 2955592 Whatta
Whatta's picture

Smith and Wesson's up 5%

 

Gold Guns and Generators and Groceries...and God if you need him(her)

Wed, 11/07/2012 - 09:56 | 2955601 SheepDog-One
SheepDog-One's picture

Fine..now all the Obamanoids will own what comes next. Stupidass country.

Wed, 11/07/2012 - 09:54 | 2955602 Shizzmoney
Shizzmoney's picture

This only proves that the US Treasury bubble is just around the horizon.......and that Central Banks will eventually have to print money to buy gold.

Wed, 11/07/2012 - 09:59 | 2955622 edifice
edifice's picture

The Treasury bubble is already in full-swing... TIPS yield on the 10-Year is negative out to 20 years, or something ridiculous. Now, when that bubble pops, is when things get interesting, for precious metals.

Wed, 11/07/2012 - 10:05 | 2955609 THE DORK OF CORK
THE DORK OF CORK's picture

I guess deep down most zero hedge readers really like Barry

 

In this monetary system its either fiscal expansion or Greece............

 

Unless you want a pre 1648 world.

 

But you can't have something in between - its either one or the other - there is no in between.

 

If you just print $$$ without bonds backing them then you lose much of your oil ration.

Tough choice is it not ?

 

“The first world war vol 1? by Hew Strachan – the “financing the war section” – a must read.

The Germans & French held much of the above ground gold ( not unlike China & Japan $ treasuary holdings today ?)
The UK could “print” more Gold as the Empire had control over most of the below ground stuff in Canada & South Africa.
While India gave it a favourable balance of trade ( I think Europe of today functions as the modern India)

OK there was a run on the BoE………in my opinion because the US became both China & Saudi Arabia in one monster package.
The Bank act was suspended and the clearing banks expected the Gold standard to finish as the BoE would need to issue more notes , but HMT issued the notes (legal tender in Scotland & Ireland)

Keynes hammered home 2 points – the first was the difference between the internal demand for gold and the external.
1. The first was the internal vs external demand for Gold – the 10shilling notes (paying 5% interest) were for the former.
By easing the domestic calls for Gold the Bank had more gold available for exchange purposes.

2. He reiterated throughout the war that it was useless to accumulate gold reserves in times of peace unless it was intended to utilise them in time of danger.
This is the MMT full employment meme in its ancient form.
By maintaining purchasing power Britian could SUSTAIN ITS PURCHASING POWER IN INTERNATIONAL MARKETS AND WOULD RETAIN FOREGIN CONFIDENCE & THEREFORE FOREGIN BALANCES IN LONDON.

But if HMT just issued raw notes into the economic medium – what would have happened ?
Would we have had the War to end all wars ?

Wed, 11/07/2012 - 10:09 | 2955672 LawsofPhysics
LawsofPhysics's picture

Blah, blah, blah...  that which cannot be sustained, won't be.  Long black markets and anything physical of real value.

Wed, 11/07/2012 - 09:56 | 2955615 krispkritter
krispkritter's picture

Ammo is up a lot more than 2-3%...

Wed, 11/07/2012 - 09:58 | 2955620 qweston content
qweston content's picture

 

I think if Romney would have gotten elected we would have had a major depression towards 3rd quarter of next year. I am not saying that I agree with what Obama stands for but it is going to buy us more time to figure out what to do about all the debt and the lack of jobs. http://thebasicsofliving.com/?p=252&preview=true

 

 

Wed, 11/07/2012 - 10:03 | 2955638 JPM Hater001
JPM Hater001's picture

Are you nuts?  This puppy tumbles soon and it would have regardless of who was elected.

Now, can we make it to inauguration day?  Doesn't matter any more.  It wont really change then either.

Wed, 11/07/2012 - 10:02 | 2955635 DeadFred
DeadFred's picture

If you want to make a lot of money short the rare earth stocks and use the cash to hire a protein engineer to modify the structure of an ion channel to selectively transport a rare earth element. I'd go for neodymium because it is the coolest. This is doable. Too bad my labware is packed away.

Treasuries have broken out of their downward trend and copper is sitting on support. We may see some fun action soon to help us forget our sorrows.

Wed, 11/07/2012 - 10:18 | 2955712 aerojet
aerojet's picture

WTF?  The kooks are out in force today...

Wed, 11/07/2012 - 10:06 | 2955662 orved
orved's picture

please note the recent sell off. the 2 day rally doesnt even make up half the fall.

dont worry though... I am still long up to the ying yangs.

Wed, 11/07/2012 - 10:25 | 2955743 edifice
edifice's picture

The Treasure of the Sierra Madre, revised for the 21st century:

Guy 1: "Why is gold worth some 2,000 bucks an ounce?"
Guy 2: "I dunno, because it's scarce..."

Wed, 11/07/2012 - 10:49 | 2955845 jjsilver
jjsilver's picture

It wouldn't make a difference which puppet administrator without a signed oath to support "This" Constitution is sitting in the white house. The Bankers run the show and the only way to extend this monetary fairy tale is to inflate.

Wed, 11/07/2012 - 12:02 | 2956268 j8h9
j8h9's picture

Silver $31.24/oz -0.73

Gold $1704.40/oz -11.20

 

PM ARE DOWN DOWN DOWN today. All the European markets are down and it's not because of OBAMA.

Wed, 11/07/2012 - 12:55 | 2956679 Nehweh Gahnin
Nehweh Gahnin's picture

"Obama’s election means that quantitative easing, ultra loose monetary policies and currency debasement are set to continue in the world’s number one economy which is bullish for gold – and indeed silver."

Huh?

"...there may not have been a whole lot of difference in the fiscal and monetary approaches of both men and any differences would likely be a matter of degree."

You almost recovered, there.

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